Big homes hold their appeal

We may be having fewer children, but demand for four and five-bedroom homes in Sydney shows no sign of falling in line with family size.

We’re still just as keen to buy big homes ?if we can afford them ? and while that might once have been for kids to each have their own bedrooms, today we have multiple uses for the space.

Now we like to be able to use extra rooms for children’s homework, for older children to stay on throughout university and well into their working lives, for parents to have a study and separate TV room, or to accommodate extended family and guests.

“For a lot of people, three bedrooms just isn’t enough,” says Peter Baldwin, director and chief auctioneer of Richardson & Wrench.

“People from new cultures need extra bedrooms for their extended family and, with the cost of care for older people, others like to use them for grandparents, too.

“Also, we’ve found couples are planning their next home on a 15-year plan and missing out stages of moving from smaller to medium-sized homes to bigger ones to save on stamp duty in the future. And then we have mum and dad coming to stay to help with the mortgage, so those extra bedrooms are a huge bonus.”

The trend runs counter-cyclical to population changes, with census data showing the average household was 4.5 people in 1911, compared with 2.6 in 2011, with the Australian Bureau of Statistics projecting that to drop further to between 2.5 and 2.6 by 2036.

The Australian Institute of Family Studies reports the fertility rate in Australia in 2012 to be 1.93, as against 3.55 in 1961.

Yet the growth in prices for four-bedroom homes has remained relatively strong, at 37.8 per cent over the past five years and 12.7 per cent over the past year, according to Domain Group senior economist Dr Andrew Wilson, with the median price across Sydney now $930,000. By contrast, prices of three beds, with a $750,000 median, have grown only a fraction more, at 42.9 per cent over five years, and 15.7 per cent last year.

A large proportion of the increase was from new dwellings approvals, with the value of off-the-plan apartments by developers jumping “Four-bed homes are probably more prevalent in the older suburbs, although in the eastern suburbs they’re at a price point of $3 million to $5 million,” says Angus Raine, executive chairman of Raine& Horne.

“They’re better value on the upper north shore where there are a lot of big blocks and homes, and you get more bang for your buck, while in the newer suburbs around the north-west and south-west of Sydney they’re less common, or tend to be a lot smaller.”

The most affordable then tend to be in the middle and outer rings of Sydney, advises property analyst Louis Christopher of SQM Research, with supply increasing in the outer areas as more land is released for development.

“It’s an interesting fact that the larger the property, in terms of land size, the lower the price per square metre,” he says.

“Newer properties tend to be a bit smaller, and may look cheaper, but in terms of price per square metre, they tend to be more expensive.”

Christopher tends to favour Wahroonga on the upper north shore, and around Liverpool in the south-west for value-for-money four-bed homes, while Raine rates the upper north shore’s St Ives, Roseville, Turramurra, Lindfield and Warrawee.

For those who like to be closer to the city, Baldwin suggests a four-bed ?or a three-bed-plus-study ? terrace in some parts of the inner west such as Newtown, or out towards Gladesville, and Moorebank and Hurstville.

Elsewhere he favours Ryde, Forestville, Eastwood, Epping and Beecroft.four beds,” Baldwin says. “Those include North Rocks and Winston Hills, while on the northern beaches there’s Beacon Hill and Narraweena, and down south there’s still value in Miranda, Caringbah and Loftus.”

Apr 9 2016 / Sydney Morning Herald